Friday’s warning is the latest in a months-long dispute that the governor has had with the school board over their decision to approve Seitz’s contract.

School Board President Anthony Mancuso said he was disappointed that Christie "would use the children as pawns."

But some question whether the governor has the legal authority to back up his threat.

Paul Tractenberg, founding director of the Institute on Education Law and Policy at Rutgers-Newark, doesn’t think he does. He said only the commissioner of education can decide to withhold funds, and only if a district is found to be in violation of state law. And only a court can rule whether Parsippany violated the law by approving Seitz’s contract. Otherwise, the district is "entitled to state aid," Tractenberg said.

The 'Let's Make a Deal' moment in Gov. Christie's budget speechLedger Live for Tuesday February 22nd, 2011 - Ledger Live with Brian Donohue. On today's show: N.J. Governor Chris Christie delivered his state budget address today and offered a quid pro quo which he calls a "powerful incentive to sweeten the pot" regarding pension reform.

"If there is the authority in the state, it doesn’t reside with governor," he said. "I think the governor has this delusion of grandeur that the legal niceties don’t apply to him."

"I have nothing to add to the governor’s comments last week, which were clear enough," Drewniak said. "We’ll have to see how it plays out."

Tuesday, Christie announced that he was increasing school aid by $250 million and that every district could receive an increase.

The threat - regardless of whether it materializes – was enough to scare board member Bob Crawford, who voted against Seitz’s contract.

"If the Governor didn’t believe he had that authority, he would not have made the statement he did," Crawford said. "There appears to be a very real risk that the Parsippany board of education needs to take seriously."

Mancuso drew a different conclusion from the governor’s words. He believes that the governor’s threat was made because the law is on Parsippany’s side.

"It would seem to me that if they felt confident that they were going to win, they would want to have this settled in court," Mancuso said.

The board voted Nov. 9 to raise Seitz’s salary from $212,020 to $216,040 during the first year of his new contract. Seitz will receive a 2 percent raise in each of the next four years, which will take his salary to $234,065 by the end of the contract.

The contract took effect on Dec. 1. Kathleen Serafino, Morris County’s executive superintendent, has twice told Parsippany they must rescind the deal.

New rules would have capped Seitz’s salary at $175,000.

Crawford said he will again try to rescind Seitz’s contract when the board meets Thursday. This will be the fourth time he has attempted to do so.